November/December Western Reporter by Western Retailer Magazine

WHFA membership

Journal of the Western Home Furnishings Association

westernreporter

november/december 2008

est.1944

Western Home Furnishings Association 500 Giuseppe Court, #6 Roseville, CA 95678 CHANGE SERVICE REQUESTED

www.WHFA.org

Presorted Standard U S Postage PAID Permit #604 Sacramento, CA

Journal of the Western Home Furnishings Association

table of contents

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features

EDITORIAL STAFF Managing Editor: Melissa Dressler................................ mdressler@whfa.org Publisher: Melissa Robinson............................................ mrobinson@whfa.org

President’s Message...................................................5

2008 WHFA OFFICERS AND EXECUTIVE COMMITTEE

Editor’s Message........................................................6

WHFA PRESIDENT Keith Koplan - Koplan’s Furniture, Vancouver, WA.............................(360) 695-3388

Feature Article:................................................ 10 Industry Icon: Jerry Epperson

PRESIDENT ELECT Marty Cramer - Cramer’s Home Furnishings, Ellensburg, WA...........(509) 933-2172 VICE PRESIDENT Claudia LeClair - Fiesta Home Furnishings, Scottsdale, AZ...............(480) 951-3239

Owning a Brand Store................................................20

TREASURER Angel Lopez - Dearden’s, Los Angeles, CA........................................(213) 362-9600

Royal Mattress - A Friend to the Industry...................22 WHFA Board of Directors Meet.................................27

SECRETARY Chris Sanders - Everton Mattress Factory, Inc., Twin Falls, ID..........(208) 733-3312 EXECUTIVE COMMITTEE CHAIR George Nader - Nader’s La Popular, Gardena, CA............................(310) 327-8585

My Story: Growing Up in the Furniture Business........32 A Year in Photos.........................................................36

PAST PRESIDENTS Marvin Kerby - Kerby’s Furniture, Mesa, AZ.......................................(480) 834-3888 Cherie Rose - The Rose Collection, Los Gatos, CA...........................(408) 395-7773

Retailer Q & A............................................................40

EXECUTIVE director Sharron Bradley - WHFA, Roseville, CA.............................................(916) 784-7677

departments

AT LARGE EXECUTIVE COMMITTEE MEMBers Bob Ammirato - Design Galleria By Valentine, Sacramento, CA........(916) 922-2200 Howard Haimsohn - Lawrance Contemporary, San Diego, CA.......... (619) 291-1911 Lael Thompson - Broyhill Home Collections, Aurora, CO...................(303) 360-9653

Industry Beat..............................................................8 Board Member Q&A....................................................8 with Dave Harkness, Harkness Furniture

WHFA/NHFA Liaison David Harkness - Harkness Furniture, Tacoma, WA...........................(253) 473-1234 WHFA Board Members Gary Absalonson - Walker’s Furniture Inc., Spokane, WA.................(509) 533-5500 Eric Blackledge - Blackledge Furniture Co., Corvallis, OR.................(541) 753-4851 Dave Cavitt - Furniture Enterprises of Alaska, Anchorage, AK...........(907) 264-5210 Gene DeMeerleer - Furniture West, LaGrande, OR...........................(541) 963-5440 Jack Fendrich - Brenner’s Furniture, Eugene, OR.............................(541) 345-4451 Greg Follett - Follett’s Furniture, Lewiston, ID....................................(208) 743-0177 Eric Foucrier - Linder’s Furniture Mart, Garden Grove, CA................(714) 210-4848 Giff Gates - Gates Furniture, Grants Pass, OR..................................(541) 476-4627 Ron Hoesterey - Royal Mattress Company, Inc., Orange, CA............(800) 987-6925 Paula Holt - Home Collections/Dining Collections, Salem, OR..........(503) 589-4358 Jerome James - Hafer’s Home Furnishings, Manteca, CA.................(209) 823-2122 Julian Jeppe - Reeds Furniture, Agoura Hills, CA..............................(818) 597-7800 Doug Kays - Premiere Home Furnishings, Los Angeles, CA.............. (310) 268-0811 Chuck Kill - Bedmart, Tucson, AZ.......................................................(520) 887-7039 Tim Koerner - Koerner Furniture, Coeur D’Alene, ID..........................(208) 666-1525 Karen Kohlman - West Harvard Furniture, Roseburg. OR.................(541) 673-4221 Don Lemieux - Naturwood, Rancho Cordova, CA..............................(916) 638-2424 Sandy Lundgren - Olsen Furniture, Shelton, WA................................(360) 426-4702 Robert Myers - Ashley Furniture HomeStore, Chico, CA....................(530) 345-2616 Michael Nermon - Ergo Customized Comfort, Irvine, CA...................(949) 833-0338 Ray Nunez - Furniture Savings Center, Sacramento, CA...................(916) 487-6005 Sally Servidio - Silverado Home & Design, Napa, CA........................(707) 251-0888 Tom Slater - Slater’s Home Furnishings, Modesto, CA......................(209) 522-9097 Valerie Watters - Valerie’s Furniture and Accents, Cave Creek, AZ....(480) 483-3327 WESTERN HOME FURNISHINGS ASSOCIATION STAFF Executive Director: Sharron Bradley................................................(916) 960-0345 Asst. Exec./Marketing Director: Kaprice Crawford..........................(916) 960-0346 Business Manager: Janice Carlson..................................................(916) 960-0347 Events Manager: Cindi Williams.......................................................(916) 960-0277 Operations/Warehouse Manager: Jef Spencer...............................(916) 960-0386 Communications Planning Manager: Melissa Robinson................(916) 960-0349 Managing Editor & Webmaster: Melissa Dressler...........................(916) 960-0385 Membership Manager: Michael Hill..................................................(916) 960-0263 Member Services Specialist: Margie Jacobs...................................(916) 960-0199 Member Services Rep : Adam Gardner...........................................(916) 960-0291 Accounting Assistant: Melody King.................................................(916) 960-2476

Contact WHFA at www.WHFA.org or (800) 422-3778.

New Advertising Programs Customized Radio Station....................................28 Creative Newsletters.............................................29 Meet the New Members............................................31 Member Profile . ........................................................38 Lindsley’s Home Furnishings, Grangeville, ID Industry Dates............................................................43 Tips and Tricks............................................................45 Fun Facts & Figures....................................................46

contact Phone: (800) 422-3778 (12 western states) (916) 784-7677 Online: www.WHFA.org est.1944

Fax:

(916) 784-7697

Mail:

500 Giuseppe Court, Suite 6 Roseville, CA 95678

Western Home Furnishings Association is the western affiliate of National Home Furnishings Association

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November/December 2008

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president’s message This is a good time to discuss the importance of our relationships in the business and not only what they can do for you but what you can do for them (with all due respect to former President Kennedy). WHFA is an organization dedicated to the retail furniture industry and has a nearly 1,000 member base located in the western states including Hawaii and Alaska. The geography ranges from the majestic Rockies on the east to the Pacific Ocean and Hawaii on the West; from Alaska on the north to the Sonoran Desert on the Southwest. During this year as president I have had the opportunity to visit personally with members from virtually every state and corner of the region. Your fellow members’ businesses range in size from large multi-store operations that do tens of millions of dollars in volume to single stores in small communities that are pushing hard to reach the million dollar threshold. Your board of directors and slate of officers are a very good cross section of that membership, and our goal is to serve your needs and help make you a better business operator by offering services, goods and leadership that help you succeed; and yes, in some cases, simply survive. I have just returned from the WHFA fall board meeting where attendance was at a near low in spite of the lovely location. Some members had conflicting family issues as is often the case but the truth of the matter is that with current economic conditions many of the board are forced into different job responsibilities in their businesses that diminish their discretionary time. Other members quite simply didn’t want to endure the travel expenses. Every discussion and decision by the board was done with this in the background. We are the membership, and we felt the same constraints as every other member of our organization. We removed frills from the upcoming budget and focused on what we must fund not what we would “like” to see happen. Your association is all about you the member… from our Executive Director Sharron to the smallest member store, we are dedicated to helping you through tough times. This asks the question: What can you do to help us? The answer is simple yet varies greatly with each member. It costs you nothing to answer a survey when we ask for information; please take a few minutes and provides your leadership with guidance (less than 15 percent of attendees responded to the annual conference survey). Use our vendors and services to your advantage; whether it is for a lower price or to use as leverage for a better price in your market. Attend market events, board meetings and most of all the annual conference next spring. Budget ahead for it because you will gain more value for your business than any other investment; cancel an ad, this will yield far bigger returns! These are very difficult economic times and there is much we cannot control… our goal is to work on those things we can control; working together is a manageable variable that we cannot afford to forget.

Keith Koplan 2008 WHFA president Koplan’s Furniture Vancouver, WA KKoplan@koplans.com

ON THE COVER This month’s topic is all about you, the WHFA member. On the cover is just a sample of the fun we have had in 2008. Look on pages 36 & 37 for even more fun photos! Contact WHFA at www.WHFA.org or (800) 422-3778.

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November/December 2008

editor’s message

It is Time to Connect As most of you know, I write this letter a few months in advance. So, as I am sitting down to write this message to all of you, the stock market has just gone through two weeks of turmoil and after the largest gain ever on Monday, it has tumbled 700 points today due to the inevitability of a recession. Even though the news may be pointing to a recession, it isn’t a time to panic… you just need to tighten up your business practices and the entire industry needs to support one another. This issue of Western Reporter focuses on you, the WHFA member. It contains numerous member stories and will hopefully inspire you and give you new business ideas. The issue also features an interview with industry icon, Jerry Epperson. While interviewing Jerry, he mentioned he has stayed in this industry for over 30 years because of the people. I would have to agree with Jerry. The people in this industry are like one big family — which is exactly what our industry needs during a slow economy. Through my visits to the Las Vegas Market, WHFA Conference and all of my interviews with our member profiles, it is apparent that our members are a special group of people. They care about their employees, their community and each other. Like Jerry mentions, what other industry can compete all day and still be friends at night. Furniture retailers are open to sharing their successes and asking for help. During tough times, it is important to reach out to your furniture family and ask for advice. There are numerous opportunities for this idea sharing between members — whether it is through articles in Western Reporter, at conference, market or on the WHFA website discussion forum. Each member that participates is able to learn something new from true experts — other retailers. During this economic crisis, it is important to lean on others who truly understand your industry and what you are going through. Hop online and post a question or comment to the WHFA discussion board, or pick up the WHFA Membership Directory and connect with another retailer. While the news is reporting doom and gloom, don’t let that affect your business. Instead, focus on the positive and lean on other retailers for support. I hope you enjoy this issue, learn a few new ideas from the members that are profiled and take a few minutes to connect with another retailer to learn something new!

Melissa “Mel” Dressler Western Reporter managing editor MDressler@whfa.org

looking forward

business planning & forecasting

J o u r n a l o f t h e We s t e r n H o m e F u r n i s h i n g s A s s o c i a t i o n

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october 2008

to January 2009

www.WHFA.org

Social Networking

Last month’s feature articles are available online at www.WHFA.org or view our new digital magazine at www.issuu.com/ westernreporter/docs/october_08.

November/December 2008

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Contact WHFA at www.WHFA.org or (800) 422-3778.

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industry

beat La-Z-Boy Honors Top Performing Galleries La-z-Boy honored the La-Z-Boy Furniture Galleries stores that had the best sales growth in 2007 in an awards ceremony earlier this year. Four stores owned by WHFA member Ed Breunig III and Ron Hernandez were among the Top 10. They operate stores in Glendale, Chandler, Mesa and Scottsdale, AZ. Members Don and Becky Gruner also made the top 10 list for their store in Reno, NV. Congratulations to both WHFA members for the terrific year.

Abbey’s Furniture Showcase adds Restonic Sleep Center Bob and Kelly Hanni owners of Abbey’s Furniture Showcase located in Butte, MT recently purchased an additional 5,000 square feet of showroom and installed a Restonic Sleep Center. Abbey’s Furniture Showcase carries a full variety of family furniture, mattresses, home decor and soon will be adding appliances to their product offerings. Bob and Kelly purchased the business two years ago and renamed it after their daughter.

board

member

Q&A

Q What is your biggest challenge in furniture retailing? A Training our associates to think like a customer and act like an owner. Q What is your most prized possession? A My family. I am so blessed to have married my best friend, have a daughter that patiently educates first grade minds and a son who will be joining me in the business. Q What cartoon character best describes your personality? A The Road Runner. I’m always on the go, can’t stay still very long and just need to be doing something most of the time to stay busy. Q What is the most overlooked secret to success? A The details. You have to keep on top of freight damage, dated inventory, freight rates, correct invoice pricing, charge backs, parts, return to vendor items, cash discounts, etc. If you watch the pennies the dollars seem to follow.

with Dave

une onth t mber m y r e Eve oard M re into B o learn mo t Q&A your WHFA u o ab t members. board

Q What’s your secret indulgence? A Anything chocolate (but it’s not much of a secret). Q What do you do for fun? A Ride jet skies, play racquetball, play and coach volleyball, go to amusement parks and ride roller coasters,  watch sports, collect coins, and go over my furniture inventory flow reports (I know I should really get a life).

Dave Harkness owner Harkness Furniture 6612 S Tacoma Way Tacoma, WA 98409-4025 (253) 473-1234 x19 dave@harknessfurniture.com www.harknessfurniture.com

November/December 2008

Q What do you enjoy most about being a WHFA member? A The socializing. Some of the nicest people and our best lifelong friends are furniture retailers. I LOVE THE FURNITURE BUSINESS!

westernreporter

Contact WHFA at www.WHFA.org or (800) 422-3778.

feature article

Industry

Icon Jerry Epperson W

estern Reporter magazine recently had the opportunity to chat with one of our industryâ&#x20AC;&#x2122;s most recognizable and insightful leaders, Jerry Epperson. From our conversation, we learned a great deal about this impressive industry icon; from his beginnings in the industry to what he sees in its future. Western Reporter: What is your background, and how did you become involved in the home furnishings industry? Melissa Dressler Western Reporter managing editor

Jerry: I grew up in a town on the Southside of Virginia called Victoria. It was a one stoplight town with 1,500 people. There was a Bassett veneer plant just west of town and a Lee Industries bedroom plant just east of town. My father was a conductor on the railroad that ran through all the furniture towns on the Southside of Virginia. So dad could tell you which factories were doing well and which factories were doing poorly based upon a number of things, including how much coal they needed for the boilers and how many boxcars they needed to ship their products. This was back in the 1950s and 1960s. When I went off to the University of Virginia for undergraduate school and went to business school, the only people that I knew in business were furniture related, so I started doing studies on furniture. I continued that in graduate school at the College of William and Mary. When I got out, Levitz was the hottest stock on Wall Street. It was selling 120 times the earnings. I was the fortysecond analyst to join the New York Society of Furniture Analysts in 1971.

November/December 2008

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Contact WHFA at www.WHFA.org or (800) 422-3778.

WR: What continues to surprise you about this industry? J: That there are so many opportunities for retailers, manufacturers, importers to create niches and develop new methodologies. It is truly an entrepreneurial dream to be in the furniture business.

WR: What has made you stay in this industry for over 30 years? What do you like best about the industry? J: The people, first of all. This is a very social industry where we can compete every day and still be friends that night when we see each other at dinner. We can work together towards certain issues. This is an industry where we have different religions and races getting along very well, and I enjoy all of that.

“

This is a very social industry where we can compete every day and still be friends that night when we see each other at dinner.

mixed up with many other people. I am surprised at how many more people know me than I know them, because they have seen me somewhere or read my articles. It is always very gratifying.

WR: Do people come up and ask you what your forecast is for the industry? J: Oh yes, especially these days when the business is trying. You almost would like to put it on a tape and say, “Push Button A and here is my answer.” That is one of the reasons we put together the statistics that we do and the overviews that we do for each High Point Market, to kind of define exactly where the industry is. That is Mann, Armistead & Epperson’s contribution to the industry. We allow everyone access to this material to give them the most current, accurate information that we can provide.

WR: In your opinion, who are three people that WR: If you could do anything over in your have shaped the industry over the last 30 years? professional life, what would that be? J: I would say Nat Ancell at Ethan Allen, one of the co-founders of Ethan Allen who taught us that we ought to be selling an experience and a solution as opposed to just selling a product. Mr. Ed Lane because he taught me so much about how the industry worked and he made me realize that the different product categories had definite links among them that made sense. Also Hyman Meyers, the chairman of the board of HeiligMeyers who taught me the difference between the financial side and the merchandising side of the retail furniture business. And, if I had a fourth, I would say Larry Moe, the founder of Universal Furniture, and he was the gentleman who really explained to me the potential of imports.

WR: What has been the most interesting part about being a researcher in this business? J: Some things in my life stay very constant, like the nature of our research and the statistics. Every day we learn something new in this business and that is what keeps it interesting to me. When I was younger, this industry was sort of black and white, and it was done this way or that way, and there wasn’t any confusion. As I have gotten older and seen exceptions to every rule, it has made me really appreciate the complexity of the business.

WR: When people see you in the hallways at Market, what do they say to you? J: Most of the time, they just say hi. A surprising number of them say that they enjoy my column in Furniture Today or they enjoy my email newsletter or they have seen me speak. I am a fairly recognizable individual, so you don’t get me Contact WHFA at www.WHFA.org or (800) 422-3778.

J: I wish I would have spent more time at home with my family when I used to work every night and every weekend. I wish I would have traveled a little more overseas when I was able to travel; I am sort of limited in my travel these days. And I wish I would have been able to define and spend more time with certain individuals that meant a lot to me in my career. One of the things that I am very proud of is that when Nat Ancell turned 90, I would take one weekend every month and fly to Connecticut and spend Saturday afternoon and Sunday with him; just sort of sit at his elbow and learn from him. We would discuss the issues that were important to business. I did that for nine or 10 months and it was a wonderful learning experience to get that kind of exposure from someone who has had such wonderful knowledge and foresight in the business. I wish I could have done that with more people.

WR: Home furnishings retailers are competing with many other industries for the consumer. What is the biggest difference between our industry and other retail industries that target the customer’s discretionary dollar? J: Furniture has a tremendous lack of self esteem. We feel like all we can do is continue to discount and give away our products and make them cheaper and cheaper. We don’t have the self confidence to recognize that we sell a product that has a tremendous economic value because it lasts longer then just about anything else you will purchase. It brings comfort and pride every day you have it and there is an emotional side of furniture. It is a way of personalizing your home, westernreporter

November/December 2008

self expression, and it is a way of explaining to other people who you are. And we don’t get credit for any of that. We just constantly sell it at a discount, on credit and we pray that they will come into the store.

WR: What do you believe we aren’t doing correctly in this industry? J: We aren’t communicating to the consumer what a tremendous value we offer. We aren’t communicating how long the product lasts. We aren’t communicating the pride that you get from a beautifully decorated home. We are not focusing on the benefits that we have. As energy costs go up, people will be spending more time at home. That should be very beneficial to us. People will be working more from home. Many corporations are going to four day work weeks, which means people will be spending more time in their homes. People are taking vacations at home because travel costs so much. Because of the low value of the dollar, people are not leaving the country, and they are staying here. All those things we should be pounding the table on and taking advantage of and saying, “Gee wiz, you’re not moving, you’re not changing these days, let’s

“

Buyers and most of the retailers are men, most of your floor salespeople are men and women make 90 percent of the buying decisions. There is a major disconnect.

make the home you are in as beautiful and make you as proud as you can be about it.”

WR: How should retailers accomplish this? J: I have been a big proponent for years of us trying to get into the consumer’s home. We are not selling a book or a CD. When a consumer comes into our retail store, we don’t know what their home looks like, we don’t know what they need, and we have no idea how we can really exceed their expectations and solve their home furnishings problems by just sitting in a store and waiting for them to show up. If it could become the norm that when you get ready to decorate or buy furniture that you invite the home furnishings people to come to your home and share ideas with you as opposed to just going to the store to see what is cheapest, that would be a tremendous benefit to us. It is one of the reasons why Ethan Allen is so successful; they go to the consumer’s home. Swimming pool people don’t wait for you to come to them; they go with you to your home and give you an idea of what you can do. This is a core mistake in how we are selling furniture. Secondly, ours is an industry run by men that design the product and sell the product. Buyers and most of the retailers are men, most of your floor salespeople are men and women make 90 percent of the buying decisions. There is a major disconnect. I can’t think of another industry where women control so much of the consumption and have so little input into the creation. That has got to be resolved.

WR: With that, where do you think the design of furniture products is going to go in the future? Do you believe consumers will have more input in what is being created? J: I think the Internet, and communications of that sort, is going to give the consumer increased exposure to styles and categories of home furnishings that they never knew existed. It is just a matter of the younger generations moving along and teaching how to do that. Prior to World War II, our furniture in the U.S. was very homogenic. There wasn’t a lot of difference in it, and it evolved very slowly. But when our men and women went overseas and got exposure to the different cultures and the different styles, the different scales of furniture, they came back and they wanted that. That resulted in the an absolute explosion in the different categories of furniture in the 1950s and 1960s. I really think we need that kind of excitement again.

WR: With the Internet and technology becoming so prevalent in our every day lives, where do you see the future of online retailing in our industry? J: I have a problem with online retailing primarily because I am 60 years old. I have a hard time believing that the American consumer is going to point-and-click a sofa and bring it into their home. But then again, I didn’t think that women were going to buy apparel off of TV shows like QVC. I just couldn’t imagine that they would because most women that I know are so particular about the color and the fit; but they do it. So I guess it will come with time. I think it will have a greater impact on the purchase decision on the more commoditized type of furniture, whereas the big role of the Internet is going to be to show the consumer how many combinations are out there. No furniture continued on page 14 12

November/December 2008

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Contact WHFA at www.WHFA.org or (800) 422-3778.

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“

In most of our products, we can show the source and materials [that are used to build furniture] and make sure consumers know that we are not using . . . continued from page 12

store out there, not a single one in the U.S., is big enough to show all of the different styles and categories and even within all of the different collections all of the pieces. We go to High Point, we see 12 million square feet of showrooms and even there, the manufacturers are just showing parts of their lines, so no one can show all of that. The consumer goes to the store and sees 2 to 3 percent of what is available and makes their choice. We need to be able to give them exposure to a broader cross section and help them be able to personalize the home more.

WR: With the sustainable furniture trend occurring, how do you see the industry becoming more eco-friendly in the products that we use? Many of our products are ending up in landfills because they are unable to be recycled, do you see the industry leaning towards using more recyclable products in the construction of furniture? J: We are one of the industries that should be able to benefit from that. In most of our products, we can show the source and materials [that are used to build furniture] and make sure consumers know that we are not using endangered hardwoods. The technology exists today to make good finishes to meet different standards, so that ought to be something we should be a leader in. It is a lot easier to make furniture that

November/December 2008

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is sustainable and meets the certain standards then it is to manufacturer an automobile or other products.

WR: What do you see as being the key elements of success for a retailer? J: Differentiating why you’re in the market place. There is one too many people out there just doing what other people do because it looks successful from the outside. We have got too many of the manufacturers copying what Ethan Allen does because it looks so easy and it looks like it ought to be successful. We’ve got too many people copying Rooms To Go, we’ve got too many people copying certain simple formulas because they think it will work for them too. Not everybody is going to be a Crate and Barrel, not everybody is going to be a Rooms To Go, not everybody is going to be an Ashley HomeStore. Each of these has got a strength within them that permitted them to grow and be successful. The market is so diverse and huge that there is still a lot of opportunity out there for community stores, stores that serve certain ethnic communities within populations, for serving people by age, income — all the different

Contact WHFA at www.WHFA.org or (800) 422-3778.

classifications â&#x20AC;&#x201D; just because there are so many of them.

How do you see the demographics of the furniture store owner evolving? J: We have a problem right now. So many of our independent furniture stores were started after World War II and Korea by young people who were returning home and were well recognized in their communities; they were returning heroes, and they were looking for businesses to start up and put their names on the door and have the local community reward them for their service. Now those people are in there 70â&#x20AC;&#x2122;s and 80â&#x20AC;&#x2122;s and a lot of them have got good real estate and a lot of them have successful businesses but their children are doctors, and lawyers and other professionals that donâ&#x20AC;&#x2122;t want to work retail hours. And they probably donâ&#x20AC;&#x2122;t have anybody readily available to buy their business from them. This is a huge problem, and it is becoming increasingly clear as you look around the country and see that a lot of these independent stores just donâ&#x20AC;&#x2122;t have a succession plan. That is going to mean that many of these stores are going to close and create an opportunity for younger consumers. We really do have a most fascinating demographic between my generation, who is now 44 to 62; we are in our peak earning years, but we are aging out. In the next 20 years, we are going to be in a declining function and not an increasing function. Then our children, who are ages 11 to 29, are the next big, exploding group in the market, and the one thing I can tell you about this group is that they are not going to do business the same way as their parentsâ&#x20AC;&#x2122; generation. They are the first generation to ever grow up never knowing a home without a computer; they are the first generation where minorities and women have had the same educational opportunities as white men. They are going to be the most successful generation ever, and they are going to want to do things on their own terms. That is the exciting part of the future.

â&#x20AC;&#x153;

. . . endangered hardwoods. The technology exists today to make good finishes to meet different standards, so that ought to be something we should be a leader in. WR: Since the demographic of the independent home furnishings store is evolving, what do you believe the future holds for it? J: The independent furniture store should be able to recognize what is going on in their community and offer products and services in their community that the major regional stores cannot offer. They ought to be flexible, more personal. The big majors have buying power and can purchase a lot of containers from overseas, but theyâ&#x20AC;&#x2122;re sort of obligated to these big pictures; they canâ&#x20AC;&#x2122;t be flexible. They sell this entertainment center they canâ&#x20AC;&#x2122;t get you one of those

One of these people had an HH â&#x20AC;&#x153;GRAND HH&A

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November/December 2008

other ones. I think when you walk into an independent furniture store the person ought to say, “If we don’t have it in the store, please let us help you find it and buy it for you.”

WR: With the cost of production in manufacturing rising overseas, do you see a change in where manufacturing will be done in the future? J: Well, 70 percent of upholstery is still made in the United States. I think that will continue to decline slightly. Well over half of that actually is leather that is being brought in since the Chinese now dominate the leather business. But in the fabric business, I think it will continue to be manufactured here for the most part, using foam covers from overseas and other shortcuts, but building it will stay here if nothing else because of the cost to ship it. If you look at the wood business where 70 percent of the business is coming from overseas, it is truly a global market. Those 30 percent who are still domestic are seeing the differentiation in the pricing between their products and imports is getting better every day. They don’t have to pay those big transportation costs, they aren’t losing the tax incentives overseas, they don’t have to worry about the currency shifts that have been going on. So every day the domestic product is becoming more competitive, and since they are closer to the market, they ought to be more flexible and able to service the accounts as well, if not moderately better, than the accounts that are overseas. So for the domestic manufacturers, I think they have certainly weathered the worst of the storm in the wood furniture business. You will see some of the existing companies come back but I don’t think you are going to see many people reopen closed plants. It is just too difficult to do and you just need to put that genie back in the bottle. What you will see is the existing domestic plants grow and increase and surprise a lot of people with what the are able to produce. When I got in the business, you could define the productive capacity of a manufacturing plant just by the square footage. With today’s technology, we are getting two to four times as much production out of the same bricks and mortar that we did 15 years ago. You can see

“

I think you will see a lot more stores that are focusing on the younger generation since they see that as the next big wave.

that the remaining plants will produce a lot more furniture then they are now.

WR: If you were to travel five years into the future, what would this industry look like? J: I think you will see a lot more stores that are focusing on the younger generation since they see that as the next big wave. I think you will see more specialty stores that follow along the line of some of the outdoor furniture stores or bedding shops and focus on niche businesses like vacation home owners or college students. They are probably going to be, in many cases, virtual stores where they advertise and promote themselves as servicing this particular niche and not trying to be everything to everybody. I think we will also wake up and see that more stores are going to recognize where they are making their money. Today, for example, without a question bedding is the most profitable product in most furniture stores, followed by recliners and major motion and then upholstery and then most of your wood categories. Bedroom and dining room furniture is probably the least profitable thing out there in the wood category. Youth furniture, entertainment centers and home office are probably the most profitable in wood. I think you are going to see stores change their assortment to what really makes them money.

WR: What do you see as a key strategy for associations in the future, and what will their role be? J: The associations are going to have to give their members the tools necessary to be successful. These tools aren’t going to just be statistics, price tags, insurance and those kinds of services, they continued on page 18

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are going to be communications among the stores so that the different stores can learn what works for others. That is what is really important. We don’t really have any big successful national furniture chains with the exception of Crate and Barrel, Pottery Barn, and a couple of those. Ours is a regional or a local business and we already have these groups of noncompeting dealers that get together and share ideas and are immensely successful in helping each other and the associations need to do a lot more of that. And not necessarily everyone getting together in a room, it could be a virtual room.

November/December 2008

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“

I thoroughly enjoy what I do and I have the best partners and young people in the world here.

WR: What goals do you have for your industry involvement in the future? J: I am trying to cut back some on my travels just because it is so difficult for me to fly right now. I have broken my Polio-infected leg three times in the last two years and travel isn’t as appealing as it once was. I am using a lot of new services and technologies that are available today. I have done a DVD before the Las Vegas Market for the Ashley salespeople. I am scheduled to do a couple of video conferences that I will do from here where I am in a room, and I can see the audience, I am just not there with them. I am going to do some of those things. I love the business; I am not going to retire. I thoroughly enjoy what I do and I have the best partners and young people in the world here. We are proud of what we do because were not just a user of the industry, we honestly try to contribute to the industry and make it better by our presence. I look around to all of the other people that service the industry and very few can say that. I also want to remind people that the folks that survive what we are going through right now will not only get their customers back, but they will get the customers back of those businesses who have failed. Also, when you see a business shut down, don’t assume it shut down because of bad business practices. In some cases it is because the owner got tired and didn’t have an heir to leave it to or it might be that someone came in and offered them a lot of money for their real estate or they might have had a health problem and said, “I need to go home.” There are a lot good businesses, profitable businesses, that may not survive this, not because of business practices but because they have got better uses of their time and money. You hate to see it happen, but this is as normal as it can be. In the last 10 years we have lost 30 of the top 100 furniture store chains and that ratio is not going to change. We always lose a few. This period that we are going through right now just seems to be lasting longer then most of the downturns that we have had and that is what has made it so very frustrating.

Contact WHFA at www.WHFA.org or (800) 422-3778.

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Owning a Brand Store T Ed and Karen Hatterle Thomasville of Portland Oregon

homasville Furniture began more than 100 years ago in Thomasville, North Carolina. It is a well established brand and known for its quality and value. In consumer awareness it is ranked in the top five furniture companies. Thomasville is more than the name of a company; it is the name of a brand. A brand is the connection between a company and its customers. The perception of a brand and the perceived value of a company’s product and services go hand in hand. Eight years ago, we made the decision and chose Thomasville over other furniture store programs that were available to independent store owners. The store program that was offered included a concept store program that made sense as it was sponsored corporately by all divisions for the support and success of the dedicated store. The main elements that influenced us in the decision process were the brand consumer awareness, regional exclusivity, quality and value of the Thomasville product. We were encouraged by the retail support program offered, which included new store architectural design assistance, product merchandising and display, advertisement support, retail training and development, and the internet business to business support system. All of these elements are major benefits to the store’s operation. Over the years, we have found that there are pros and cons to being branded to one manufacturer. Although Thomasville offers the tools to support their network of independent dealers, we do not always have control of desired product or pricing. Independent multi-line dealers have the ability to go to market and make decisions

November/December 2008

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regarding product and assortment that best serves their needs and demographics. A dedicated store’s only option is to purchase collections that are offered by the brand manufacturer. We do not have the ability to search the market place for the best values on any given collection or style. Therefore we are locked into retail pricing and margins that are controlled corporately. If a category has been missed, we cannot go into the marketplace and fill that niche. The retail store and the brand are also affected by changes made at the top levels of management. These changes can directly affect many aspects of our business. The frequent changes in presidents and CEOs affect the culture and direction of the independent stores and the brand. Recovery from new directions and corporate leadership influences a store’s performance and profitability. We believe our business decision to become an independent Thomasville dealer was right for us. The programs offered have made the process of operating a store more efficient as we are only dealing with one manufacturer versus many vendors and their requirements. There are many options for the furniture retailer, whether you are an independent multiline dealer or a dedicated brand store owner. The challenges for the furniture retailer in today’s business environment are enormous. It is up to each individual’s comfort level to know what best serves them. If you have made the decision to own and operate a furniture store, then we commend you, because we have learned that this experience is both a challenging and rewarding business endeavor. Contact WHFA at www.WHFA.org or (800) 422-3778.

Thank You WHFA Members

Your Staff at WHFA Back row: Kaprice Crawford, asst. exec./marketing director; Melody King, accounting assistant; Adam Gardner, membership development & services; Melissa Robinson, communications planning manager; Jef Spencer, operations/warehouse manager Front row: Cindi Williams, events director; Melissa Dressler, managing editor/webmaster; Janice Carlson, business manager; Margie Jacobs, membership services specialist; Sharron Bradley, executive director; Michael Hill, membership manager

COVER CONTEST • COVER CONTEST business planning & forecasting

Western Reporter Cover Contest

Journal of the Western Home Fu rnishings Association

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Would you like to see your store on the cover of Western Reporter magazine?

april/may 2009

YOUR PICTURE HERE

Well now is your chance — participate in Western Reporter’s first annual cover contest. Submit a high quality photo of your store for one of the following categories and your photo could end up as the cover of a 2009 issue of Western Reporter! Photos can be of your store interior or exterior; of store signs or vignettes; with people or without — use your creativity! Have fun with the contest and get your employees and advertising team involved in the excitement. Submit multiple photos for a greater chance to win!

Western Home Furnishings Association 500 Giuseppe Court, #6 Roseville, CA 95678

Sales and Sales Management Trends Customer Experience

CHANGE SERVICE REQUESTED

Each winner will have their photo displayed on the cover of the Western Reporter magazine, their cover image displayed on the Las Vegas Market Retailer Resource Center video loop, and they will receive a sign and additional copies of the issue to display in their store. Have fun and good luck!

Contact WHFA at www.WHFA.org or (800) 422-3778.

Presorted Standard U S Postage PAID Permit #604 Sacramento, CA

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Cover Categories: Advertising and Marketing Retail Operations The Future Merchandising

www.WHFA.org

Photos must be a minimum of 9” x 6” (W x H) 300 dpi, .JPG or .TIF. All cover contest photos must be submitted to WHFA by January 15, 2009. Photos can be emailed to Melissa Robinson at mrobinson@whfa.org.

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November/December 2008

A Friend to the Industry Andrea Messina membership development CFMA

oyal Mattress has been building quality mattress products for residential, commercial, hospitality and institutional uses for nearly 35 years. Ron Hoesterey purchased the company over 20 years ago and during its growth, Ron has had a great time expanding the product offerings, building new relationships and participating in the furniture industry. Ron serves as a member of the California Furniture Manufacturers Association (CFMA) Board of Directors and currently is the President of that organization. He also is a member of the WHFA Board as a liaison between the CFMA and WHFA. “The best part about participating in the industry associations is that you are able to keep on top of what is happening and develop great relationships. These relationships grow into a network of friends who provide ideas and support when needed, referrals for business, and a perspective on the industry and how your business fits in that industry,” Ron said. Royal Mattress is a wholesale manufacturer who distributes its products through retail stores, interior design firms, and supplies other manufacturers such as sofa manufacturers who require sleeper mattresses, adjustable bed manufacturers who require mattresses that bend and the hospitality industry with contract style mattresses. A major regional independent, Royal operates on the principle that customers recognize and appreciate quality in the products they purchase. All employees in the company understand that people wish to be treated fairly and that the products are to be built to stand up to the uses for which they were designed. The company slogan is, “Because sleep is

November/December 2008

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important… The world chooses Royal.” In addition to meeting the needs of customers in the United States, Royal ships mattresses to customers all over the world to countries such as Mexico, Japan, Guam, China, Korea, Ukraine, Canada and Saudi Arabia. The majority of Royal’s business comes through referrals from other customers and its vendors. “I do not have to tell people we build a good product, our customers do that,” said Ron. “The way I know our product is one of the best is because our vendors come to us when they want a bed for themselves. They supply all the other firms and see what is in the marketplace so they know we build the best product.” Since Royal spends very little of its money on advertising, the company is able to provide more product value for the money.

Facility Royal Mattress designs and manufactures all of its products in its Southern California factory located in Orange, CA. Royal’s modern production facilities and scheduling systems are designed to allow for the flexibility of rapidly responding to high volume requirements or quickly fulfilling a request for one of the companies premium mattress products on an individual order basis. Asked what makes Royal’s products unique in today’s marketplace? Ron responded, “Royal continues to use construction methods and materials abandoned by others in the mattress industry. We continue to use cotton in our products because it is one of the best

Contact WHFA at www.WHFA.org or (800) 422-3778.

materials for the distribution of weight in furniture. Our mattresses are internally button tufted to ensure there is no migration of the filling materials. In addition, we did not follow the one-sided trend. People need to flip their mattresses for even wear because we do not know anyone who has overcome gravity. I find it interesting that at the last Market, one firm introduced the ‘new two sided mattress’.”

The Team Ron’s belief is that the most expensive item in any company is a cheap employee. Therefore, he and the Royal management team have committed to the development of a group of dedicated longterm employees. These employees are craftsmen who honor care and commitment in producing Royal’s products. The employees take pride in manufacturing mattresses that are tailored to a standard of excellence. Quality is a main focus at Royal. This focus goes far beyond the product, while it includes quality of the product, it also spreads to the quality of its employees which translates into the quality of service and quality the customer’s experience. Each employee understands the value system of the company and is empowered to meet a customer’s needs.

Custom Sizes A fun area of the company is the design and manufacture of specialty items. Royal Mattress manufactures odd sizes for antique beds, round beds and oversized beds. One time Royal produced a bed that was 10 feet wide and 10 feet long. “We did not ask what the bed was for,” said

Contact WHFA at www.WHFA.org or (800) 422-3778.

Ron, “We only asked how large the doors and hallways were to ensure they could actually get it in the house.” Royal also works with firms who remodel RV’s and yachts and manufactures mattresses that are mildew resistant for the conditions present in marine applications.

Going Green Introducing its Carriage House mattress line, Royal Mattress has taken 35 years of experience of developing premium sleep products for the world and put it into today’s eco-friendly and sustainable natural product line. The goal was to design a product that was not only natural, but offered the customers the great comfort, profile and support in which the company had built its reputation. Determined and uncompromising in achieving these standards, the Carriage House far exceeded the initial expectations for the product. There is an overwhelmingly enthusiastic response to this new product. After the development of the Carriage House mattress, Royal employees looked to other areas of their daily practices and routines to find ways they could make the company more environmentally responsible in its operations. Working with vendors, they found ways to have excess materials, scrap paper, trimmings from its cutting and other waste which was going to the landfill picked up and taken to recycling facilities. Royal reduced its waste from four construction dumpsters a month to less than one a month. In addition, Royal had the lights throughout its factory changed out to the new energy efficient ballasts and bulbs that greatly reduced its electric energy consumption. When asked to summarize the operation Ron told us this, “As a family run company, our strategic plan is simple. Orders come in, mattresses go out. We do not have titles on our business cards, because each employee at Royal has the same primary responsibility; meet the customer’s needs. As our industry faces tough economic times, it is now even more important to actively guard the values and principles that we have developed over time.” Royal Mattress is a proud member of WHFA with over 15 years of active involvement with the association.

westernreporter

November/December 2008

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finance

 In-Store Financing

 Mystery Shopping

 Bankcard Processing

 B2B E-commerce

 Cash Flow Management

 Performance Groups

 Equipment Financing

 Retail Business Consultants

 Cost Segregation

management

 Check Guarantee Service  Retailer Performance Report

 Business Insurance

 Store Procedures Manual

 Health Insurance

 Job Description Manual

 Workers' Compensation

insurance

 Employment Practices Liability Insurance (EPLI)

publications & manuals

 HR Legal Advice

 Computer Software Survey  Internship Guide  Career Brochure  Advertising and Planning Calander

 Personnel Policy Manual Software  Health & Safety Compliance Review

human resources

 Office Supplies

 State & Federal Labor Law Posters

 Business Forms

 Pre-Employment Background Checks  On-Site Drug Testing  Performance Management Program

operations

 Otis Spunkmeyer Fresh Baked Cookies

 Employee Retirement Plans

 Discount Paint and Customer Reward Program

 Payroll Services

 Employee Uniform Program  Business Cards

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education & training

 WHFA's eNewsletter

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 Conference

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 Academy

 Computer Purchase

 Video/DVD Rental & Purchase  Management Development Institute

 Freight Discount Program  FedEx Shipping Program

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Contact WHFA at www.WHFA.org or (800) 422-3778.

WHFA’s Board of Directors Meet for Fall Board Meeting and the Wrought Iron Chef Challenge

Recreate the Board’s Wrought Iron Chef meal on your own! Visit www.WHFA.org and click on About Us > Meet the Board to view and print all of the Wrought Iron Chef recipes.

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The WHFA Board of Directors met this past September for the annual Fall Board Meeting at the Loews Ventana Canyon Resort in Tucson, AZ. Your all-volunteer Board worked diligently for two days in the Sonoran Desert and approved two new programs (see pages 28 and 29 for details), discussed upcoming industry events, reviewed financials and approved budgets for the upcoming year. After all of the meetings had been attended and budgets and programs approved, the WHFA Board let loose and showed off their culinary skills in the Wrought Iron Chef Challenge. Separated into three teams, appetizers, entrée and desserts, the WHFA Board first was instructed to create table centerpieces for each table with items from the Dollar Store and Loews resort before they went into the kitchen. The Loews staff then judged the centerpieces and awarded the entrée team with the winning centerpiece for their fire and ice creation. After the centerpiece competition, the chefs were welcomed into the main kitchen at the resort. Each team set off to create their food masterpieces and added their own flair to the set recipes. In the end, the Board sat down to enjoy a delicious meal that they all created. As a perfect ending to the board meeting and a wonderful evening, each board member was rewarded with a Loews Culinary Institute apron. The Board will meet again during the Winter Las Vegas Market on February 10, 2009.

Whfa To Hold Annual Membership Breakfast Meeting Tuesday, February 10, 2009 (7:45 a.m. – 8:30 a.m.) Retailer Resource Center 16th Floor, Building B, Space 1630 World Market Center The WHFA Annual Membership and Board Meeting will be held Tuesday morning of the Winter Las Vegas Market, February 10, 2009, 7:45 a.m. – 8:30 a.m., in the WHFA Retailer Resource Center, 16th Floor of Building B, space 1630, World Market Center. Members will vote on candidates nominated for officers, re-election, and newly appointed terms to the 2009 WHFA Board of Directors. And, the WHFA President will pass the gavel to the incoming President. All WHFA members are encouraged to attend this meeting. Free breakfast will be served. Reservations are requested. For more information, please call Cindi Williams at the WHFA office (800) 422-3778, or at cwilliams@whfa.org.

Contact WHFA at www.WHFA.org or (800) 422-3778.

westernreporter

November/December 2008

WHFA Introduces Two New Music and Messaging CreatE your own

Customized radio station Did you know that over 80 percent of purchase decisions are made while customers are in your store? So having the choice to play your own audio messages lets you direct customers to your great deals and maximize purchases. A professional audio system makes customers spend more per item in your store because they feel more comfortable in a relaxing musical atmosphere. As your brand, you will have a great sounding store helping to ensure repeat visits. Retail Radio creates a customized radio station for your business that is designed to target your specific consumer. Whether you are a single location or have multiple stores across the country, Retail Radio is able to create your own radio station with specific music and branding messages designed to highlight the unique services of your store.

Call WHFA A Today For o Free Dem

PROGRAM DETAILS:

PROGRAM includes: • Holiday music and announcement updates. • Free insertion of up to two announcements a month if you have pre-recorded ads. • Use your own voice – no extra charge • Professionally programmed with daily updates. • Manufacture invoicing if required (co-op dollars used). • 90-day trial guarantee. • 3 year contract.

*Program costs are based on client having a working amp, speakers, 10 feet of data cable and available port.

$42.99 a month (per store location)

Custom designed music formats with your specific target in mind. Ten custom commercial announcements produced at any length (10, 15, 30 or 60 seconds). Samples include: • “Thank you for shopping at ABC Furniture — You are listening to ABC Furniture Radio” • “Bill and Jane Jones, owners of ABC Furniture want to thank you for shopping at ABC Furniture.” • Ads for: in-store financing, free delivery, 30 day money back guarantee, product categories, specific gallery options, etc…

PLU S: Three new commercial announcements each quarter. Samples include: • Event announcements, product sales, etc…

through WHFA’s partner

November/December 2008

westernreporter

Contact WHFA at www.WHFA.org or (800) 422-3778.

Advertising Programs Creative Newsletters & Articles Build brand awareness and bridge the gap between you and your potential customers with creative newsletters Be your customers’ top resource for ideas and information. WHFA’s new partnership with Whipsmart Creative can help you beef up the content on your website with customized newsletters and informative articles that give visitors a reason to linger and see more of what you have to offer. Sending newsletters is an excellent and cost-effective way to increase awareness of your organization and keep yourself in the minds of existing and potential customers. And they perform double duty as a method of gathering valuable client/customer information. If the newsletter provides the customer with the information and guidance she needs to make a buying decision, it could be the necessary marketing tool that drives qualified shoppers to your store. But what can you give your customers that they will value and build awareness of your brand at the same time? WHFA’s new program with Whipsmart Creative develops informative monthly newsletters packed with tips and trends for idea-hungry consumers — and customized just for your business with your logo on the cover and contact information inside. Use the newsletters as an added bonus to your preferred customer email list, or print them out to use as information-gathering tools within your store. Either way, you will create a consistent and helpful presence in front of your customers. Whipsmart Creative researches current topics and trends in home furnishings and décor, then translates that into easy-to-understand articles for your consumers to digest. With so much information and so many choices available to consumers, the idea behind these articles is to give consumers specific content that will help them make buying decisions with your store in mind — without confusing or overwhelming them.

Kaprice Crawford WHFA marketing director

Newsletter Themes (Individual article titles available upon request) • Color Your Home With Confidence • Outdoor Living • Bedding • Our First Home • Our Growing Family • Accessorize Your Life! • Beautiful Bedrooms • Dining In • Rooms You Can Really Live In • Working From Home • Small Spaces, Big Style • Home Entertainment

Program Highlight

• Furniture Care and Protection

• A $100 discount on customized newsletters – WHFA members – $400 (reg. $500 a month)

• The “Green” Streak in Home Furnishings

• 10% discount on individual articles (reg. $150 each) • 10% discount on graphic design services (call for quotes) Let WHFA help you build brand awareness and bridge the gap between you and your potential customers. Get started on your monthly newsletter today, (800) 422-3778.

Contact WHFA at www.WHFA.org or (800) 422-3778.

through WHFA’s partner

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November/December 2008

meet the new members New Members Who Joined WHFA in September 2008 A Royal Suite Saugus, CA Founding Year 1979 Capitol Furniture Stockton, CA Founding Year 1999 John S. Luis Floor Coverings San Jose, CA Founding Year 1979

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Kimlor Mills Santa Ana, CA Founding Year 1980 Michaels Furniture Van Nuys, CA Founding Year 1971 Norcal Sales Danville, CA Founding Year 1986

Treasures Furniture San Diego, CA Founding Year 1981 Truex Home Furnishings Livingston, MT Founding Year 1999

To join WHFA call (800) 422-3778 or visit www.WHFA.org for more information.

how

do you

recognize a

WHFA member they’re

All

smiling Contact WHFA at www.WHFA.org or (800) 422-3778.

Bottom Line Programs and Services

Advocate for Home Furnishings Retailers Peer-to-Peer Networking

Education and Industry Resources

Simplify Your Business Life

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Western Home Furnishings Association 800.422.3778 • www.WHFA.org westernreporter

November/December 2008

My Story: Growing Up in the Furniture Business

T Nick Caputo design consultant Design & Interiors

Top: Me, my dad John, my brother Mike and my mom Diane Right page: Dad with my grandfather Vincent

he beginning of my career in the furniture industry started at the 1988 Summer Market in San Francisco — I was 4 years old. As the doors opened into Mart One, my eyes lit up. There were hundreds of people in the crowded lobby waiting for a ride on one of the many elevators. When my family received our badges, we headed for the stairs to the seventh floor to see my grandfather’s showroom. It was tough heading up seven flights of stairs since I was only four years old, but I couldn’t wait to raid all the candy dishes throughout the various showrooms. Going to the Market became a traditional family outing for me because my grandfather was in business there for many years. Almost 20 years have passed since my first market, and since that time, I have attended market regularly. My grandfather spent over 40 years in the furniture industry. He was the first of three generations of my family in the industry. His run started in retail with 27 years at Breuners, and W.J. Sloan’s, and went on to many years in wholesale. He worked closely with the Italian Consulate importing merchandise from Italy to the West Coast. He had showrooms in the Design Center, Showplace, and Furniture Mart

November/December 2008

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before he opened his own store where my father and uncle started in the business, which would eventually open the doors to my career in furniture. I can remember it clearly, the event that would pave my future and change my family’s life. It was in February of 2001, we got the word that we were approved for a loan to open a 35,000 square foot home furnishings store called Heritage House Galleries. I was 14 years old and excited to enter a new chapter of our lives. I worked weekends helping my brother in the warehouse. My mother did the books, and my father ran the show while my grandfather supervised. It was a full-fledged family affair. Those years where golden and became the solid base of my career in this industry. I worked my way up the ladder in that store from changing light bulbs and dusting countless tables and shelves, to pulling delivery orders and basic leather touch-ups. In May of 2001, we mourned the loss of my grandfather. He was the man that brought us all together and introduced us to this industry that he loved, and it became my new passion. Before his passing, the San Francisco Mart and the wholesale furniture association had a

Contact WHFA at www.WHFA.org or (800) 422-3778.

I remember my father saying, â&#x20AC;&#x153;Donâ&#x20AC;&#x2122;t just pick the one you like, pick the one that will sell!â&#x20AC;?

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8FÂľWF CFFO B QBSU PG $BMJGPSOJB TP MPOH UIBU XF EPOÂľU NJOE CFJOH UBLFO GPS HSBOJUF luncheon on his behalf, to honor him for his contributions to the industry, as a wholesaler, retailer, sales rep and pioneer. A defining trip for me came in October 2001; my family and I were on our way to the mecca of the furniture world, High Point, NC. When we arrived at our main vendor, my dad let my brother and I select three sofa frames and fabrics to place on the showroom floor. I remember my father saying, â&#x20AC;&#x153;Donâ&#x20AC;&#x2122;t just pick the one you like, pick the one that will sell!â&#x20AC;? It was that first experience with purchasing and choosing a big seller that would spark my passion not only for buying, but for design. I met countless reps working client-to-client, trying to push their new products and was even more excited to meet Presidents of companies who would ask for my opinion on their line up. A few years down the road I graduated high school and was working full time in the warehouse. It was at this point that my family job quickly became a set career path. In 2003, my father decided to open a second store. With the second location opening, my brother became the store manager in Pleasanton, CA, and I became the warehouse manager in our Concord store. As manager of the warehouse, I was in charge of shipping and receiving and also my new favorite role, merchandising and display. It was during this time that I began to dab into my flare for design and finding customersâ&#x20AC;&#x2122; favorite items. I loved transforming a display floor, moving furniture around and seeing it sell. The more time I spent at the store the more Contact WHFA at www.WHFA.org or (800) 422-3778.

For generations, California employers have depended on www. scif..com State Fund to meet their workersâ&#x20AC;&#x2122; compensation needs. 'PS HFOFSBUJPOT $BMJGPSOJB FNQMPZFST IBWF EFQFOEFE PO 4UBUF 'VOE UP NFFU UIFJS Since 1914, through good times and bad, weâ&#x20AC;&#x2122;ve always W W W S C XPSLFSTÂľ DPNQFOTBUJPO OFFET 4JODF UISPVHI HPPE UJNFT BOE CBE XFÂľWF been on hand for California businesses. Call your BMXBZT CFFO PO IBOE GPS $BMJGPSOJB CVTJOFTTFT broker, or Patty Garcia of State Fund Group Programs $BMM ZPVS CSPLFS PS 1BUUZ (BSDJB PG 4UBUF 'VOE (SPVQ 1SPHSBNT BU at (800) 423-0303 and let us show you how weâ&#x20AC;&#x2122;ve BOE MFU VT TIPX ZPV IPX XFÂľWF CFDPNF TVDI B SPDL TPMJE QBSU PG UIJT HSFBU TUBUF become such a rock-solid part of this great state.

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November/December 2008

Top: (l-r) Me, my dad John, my brother Mike, my Mom Diane and my grandma. Middle: My brother Mike, my cousin Vincent (named after my grandfather) and me Bottom: Me at Heritage House

involved I became. My dad would let me sit in on advertising and buying meetings at least twice a week. Here I learned the basic customer buying patterns, the highest selling pieces and most common styles and fabrics that customers were buying. I learned a lot about managing the store from my father who inherited his great people skills from his father. My dad often helped us unload trucks, move the floor around and even did touch-up work when it was needed. I could remember my dad saying, “You can’t manage anyone if you haven’t worked in their position. No matter what title you possess always help others in their jobs. You will always earn their respect and support.” This advice has been one of the most useful skills I’ve learned as I ventured out of the family store into the general furniture world and my current position as a design consultant for Design & Interiors in Walnut Creek, CA. Another piece of advice that I have learned over the years is to, “Always find time to look to see what a rep has to offer, it could be the next best thing.” I always felt that as the owner’s son, people would think less of my ability and more of my connection, so that prompted me to become the best. I wanted to learn all aspects of the industry knowing that people could come to me with questions, and I would be able to give them confident answers. I wanted to prove that I could become a leader, not only to my father, but to the 34

November/December 2008

westernreporter

Contact WHFA at www.WHFA.org or (800) 422-3778.

factory reps, sales staff, customers and most importantly, myself. I made sure I knew every vendor, and every piece of stock we had on the floor. This is key to confident sales and 100 percent customer satisfaction. When you show eagerness to absorb more information, you are usually handed these opportunities and given added responsibility — I was. Before long I was leading a sales team, designing direct mail pieces and meeting with vendors. I know it is a rare thing to be a third generation of a furniture venturing family, but I guess you can say I was born into it and I feel lucky. As the years have gone by and the economy has taken a fall, I know the industry has made huge changes; customers have become accustomed to a world of Internet and going out of business sales. Unfortunately, my own family business ended that way, but it was another aspect of learning more tricks of the trade. Yes, customers can be unloyal because your competitor has an extra 10 percent off on the tag, so it is important to know your competition! Know what sets you apart from them and explain why the consumer should choose you. If you know what the competition has to offer, you can set your bar higher. Keep your store up to standards, make sure all pictures are hung, spaces are filled and lighting is on-point. If customers see things out of place right away, they lose faith and could assume you’re on your way out of business. Good followup with your customer can gain you a customer for life. A bad experience for a customer is an open invitation to visit your competition. Also, keep in mind your customer is either just coming from your competitor or on their way there. Customer service is a major key that is too often overlooked. Whether it is a smile the customer is greeted with at the front desk or a helpful delivery driver, these are simple steps in a happy customer. One thing that I have learned throughout my years is in furniture and design, the customer may not always be right, but they should always be happy. Contact WHFA at www.WHFA.org or (800) 422-3778.

I always felt that as the owner’s son, people would think less of my ability and more of my connection, so that prompted me to become the best. advertisement

To Your Health... There is much talk these days about fixing the health insurance / health care crisis. Our political “leaders” offer a variety of solutions to address this crisis. None of the proposals have been met with general acceptance or appreciation by the public. At the same time, the health insurance industry, trying to stave off more legislated mandates, has gone about offering a “new generation” of group health plans designed to lower premiums to the purchasing public, read; employers. These new plans are classified as “Consumer Driven” health plans requiring the insured to take a greater responsible role in accessing cost effective care. The “old generation” of health plans typically were funded by employers, very often at 100%. At the same time they offered very low costs to the employee to access benefits. Such plans often offered $5 to $10 office visits, $5-$15 prescription co-pays and no or, very low, hospitalization co-pays. Such arrangements insulated employees from the true costs of accessing care. That $5 co-pay was but a small part of the $60-$80 contract price for an office visit. As such, employees did not feel a responsibility to address the cost issue since they were insulated from true premium costs and the true costs to access care. Those days have ended for all intents and purposes, thanks to spiraling premiums and costs of care. In order to meet the current challenge of offering quality benefits at a “reasonable” premium cost we need to get creative. As prudent business people sit down with a qualified consultant / broker and explore the benefit and value of replacing current plans with one of the newer “consumer driven” health plans. These plans offer significant lower premiums as well as tax advantages to your employees. By creatively applying and combining what is offered in the marketplace employers can improve the value of benefits to their employees while holding the line on ever increasing premiums. Talk to a broker who is fully familiar with the marketplace, get a proposal for your company and see how you can create a more cost effective benefit package to your employees and do your bottom-line a favor. In future articles we will examine these newer plans and strategies, giving you a chance to evaluate their value. Bob Aita, of Aita and Associates is the Consultant and Broker for the WHFA Health Insurance Program.

707.829.8606 phone 888.829.8606 toll-free license# OE22529 www.aitaandassociates.com

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November/December 2008

s o t ho

P n i ar e Y A

During this past year, many retailers have been faced with challenging business conditions and an ever-changing economy. Despite these challenges, WHFA members came out to have fun and learn from each other during each Las Vegas Market and the Annual WHFA Conference and Expo in Tucson, AZ. Check out all of the fun that you had during 2008!

November/December 2008

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Contact WHFA at www.WHFA.org or (800) 422-3778.

8 0 0 2

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November/December 2008

member profile Lindsley’s Home Furnishings Grangeville, ID

The current generation of Lindsley’s Home Furnishings owners: Angela and Jeff Lindsley and their children (Juston age 14, Dane 5 and Cole 11).

eventy-one years ago, Sam Lindsley and his future father-in-law, Ed Jones opened an electrical supply and hardware store named “Jones & Lindsley”. Originally established in 1937 in downtown Grangeville, ID, the store primarily sold electrical supplies and hardware items. In 1939, Sam married Ed’s daughter Muriel and the two took over the business. The store sold electrical supplies, appliances such as Maytag washers, Monarch ranges, and Zenith radios, along with Muriel’s favorite: fine china. In 1945, the store expanded into the adjacent Melissa Dressler building, when furniture, and eventually floor Western Reporter managing editor coverings, was added. In the late 1960s, Sam and Muriel’s son Tom came into the business. Tom and his wife Judy ran the store side-by-side for 31 years until 2000, after Tom passed away suddenly. It was then that the fourth generation transition took place. Jeff took over the business and his wife Angela joined him three years later. “Angela was a perfect fit for this business with her At a Glance decorating and fashion Store Location: Grangeville, ID skills. It was also special Type of Store: Full-line because it kept the tradition of a husband Year Founded: 1945 and wife team running Number of Employees: 11 this business,” Jeff said. Number of Store Locations: 1 In 2002, the store Annual Sales Volume: 1.7 – 1.8 million went through a subtle name change. After a Website: www.lindsleyhomefurnishings.com windstorm damaged Top Manufacturers: La-Z-Boy, Ashley, their front awning, it Charles Snyder, GE appliances and Mohawk was replaced with a flooring new one that stated WHFA Member Since: 1988 “Lindsley’s Home Furnishings” to better 38

November/December 2008

westernreporter

Judy and Tom Lindsley operated Lindsley’s Home Furnishings from the late 1960s until 2000.

fit the store’s offerings and in 2004, Jeff’s brother Russ joined the business as the sale manager and overseas the appliance department. Today, the store is still located in downtown Grangeville, Lindsley’s Home Furnishings serves their small town with the old-fashioned values and principles that were instilled throughout the generations, while adapting and evolving to modern shopping trends by having a strong online presence. Customers are able to view products and learn about the various services such as delivery, installation and bridal registry that are available on the Lindsley’s website. With only 15,000 people residing in Idaho County and 3,200 in Grangeville, Jeff believes an online presence is important because, “We are in such a small, limited market, it opens up new customers to us. And, in my opinion, it is necessary to have an online presence, because you are deemed a little outdated if you do not have a current, functioning website,” he said. While the Lindsley’s website doesn’t allow for transactions to be performed online yet, interested buyers can email the store and express their interest in a specific product. “If a buyer has an inquiry, they can send us an email which we will receive immediately. We then turn around and establish a contact with the customer and provide them the information that they wanted,” Jeff said. When customers decide to visit the store, they are always in for a special treat. Located on East Main Street, Lindsley’s occupies a cluster of four older storefronts that have been renovated into one showroom. This creates a unique shopping experience for customers, although it is occasionally Contact WHFA at www.WHFA.org or (800) 422-3778.

frustrating for Angela from a display and merchandising standpoint. “We hear comments from our customers that are from outside of the area and they really admire the uniqueness of the layout,” he said. “With the collections of these old buildings, there are a lot of nooks and crannies, which work as a positive for the uniqueness. It is not easy to display and merchandise things like you would want, but it does add a degree of something that people haven’t seen.” Another thing that adds to the complexity of the store layout is its product offerings. Staying true to its roots, Lindsley’s still sells appliances and floor coverings. To ensure that every customer knows what is available in the store, each section is visible from the store’s entry. “Within four or five seconds, if you have never been in our business, you will see right way just what we do. When you come in our front door, in an instant you will see that we have appliances in the back and our balcony area houses our floor covering display.” The demographics of the area also play into how Lindsley’s interacts with their customers. Each customer is important, so every employee strives to give them a positive shopping experience. “In a small town, you almost have to be perfect with every customer,” said Jeff. “We just don’t have the opportunity to disappoint because of the size of our population.” One way that Lindsley’s has created an enjoyable customer experience while also increasing sales is through their annual private sale. Twenty years ago, Jeff’s father wanted to generate more business in the month of March, which was historically a terrible month for the store, so he had a private sale. Handwritten invitations were sent out to a small group, and it was a success. Over the years, the private sale evolved to using Lindsley’s entire customer list, inviting them to the store on the Thursday night before or after St. Patrick’s Day for a party with beer, wine and food. Again, the event continued to generate business, and it is considered a social event in the town. “It has now grown to a point where it is an open invitation announcement in our newspaper ads, and in a small town, it has really become somewhat of a social event. This is perfect for us because we get a lot of people in the store that night which can be overwhelming, but we see a residual effect for the following four to six weeks after the sale,” Jeff said. Another way that Lindsley’s offers a unique customer experience is by offering a bridal registry. While cultural and technology changes have shifted the Contact WHFA at www.WHFA.org or (800) 422-3778.

uses of the registry, it is still a convenience for local brides and their families. “We used to have eight to ten bride gift tables set up, and we allowed people to call in and tell us a dollar amount that they wanted to spend. We would then choose the item in the stated price range, wrap and deliver the gift directly to the reception. It was basically a convenience for the customer to call in and have it taken care of,” said Jeff. “However, over the last four to five years, most of our brides are registering online, so our bridal registry business isn’t what it used to be. Brides today aren’t as interested in china patterns like their mothers and grandmothers were, so we have evolved our bridal registry. We still promote the registry and give the couple a $50 in-store gift certificate just for registering with us. At that point, we try to target more of the larger furniture and accessory items that a couple wants. Now, when someone calls in for the service, we apply a gift certificate towards the larger purchase. So the registry has evolved from people registering for china patterns to sofas.” Keeping their ever-evolving customer in mind, Lindsley’s Home Furnishings continues to find new ways to make the customer’s experience a unique, convenient and positive one. In the future, Jeff would like to organize the business so that it is primed for sale — not that he has plans on selling it in the near future. “At any point, I want the business to be in the best financial condition and as sellable as it could be. It is a good protection mechanism for the business itself,” he said. While he doesn’t have plans in the near future to sell the business, he does hope that one day the fifth generation of the Lindsley family will take the reigns. “With our three boys and many cousins, the plan is to set the business up for sale and offer it to whichever one of those children want to be in the furniture business,” he said. Lindsley’s Home Furnishings has successfully evolved during the past 71 years and will continue to do so. With future generations of owners in the wings, it is sure that Lindsley’s will prosper for years to come.

Muriel and Sam ran the family business until the late 1960s. westernreporter

November/December 2008

retailer q&a

How have you been attracting new people into your store? Sandy: Sandy Olsen-Lundgren owner Olsenâ&#x20AC;&#x2122;s Furniture, Shelton, WA Full-Line Store Founded in 1936 1 store location (360) 426-4702

We are doing some different advertising and changing our store front and inside the store for different sales. We change our window signage, retag all of our items and add balloons, all in a matching color for the sales. It helps us with branding our look and our store looks more professional. Right now we are giving away a free gas card with the purchase of $399 or more. We are also offering free items, like candles, if people come into the store with one of our postcards which has helped to increase our traffic. Lastly, we have expanded our accessories line up which has been getting new people to visit. We have been selling 30 candles a day, which helps to add to our bottom line.

Chuck: We do quite a few different things to attract people into our Chuck Kill CEO Bedmart Tucson, AZ Bedding Store Founded in 1988 26 store locations (520) 887-7039

During our travels, we often ask members different questions about their furniture retail operation and publish their answers in Western Reporter for other members to try. Retailer Q&A is a unique column that allows you, the retailer, to participate. If you are interested in submitting your own question or would like to answer our next question, please email Melissa Dressler at mdressler@whfa.org.

store and make them more aware of our brand. Since our salespeople have a lot more down time then they used to, we have been going out to local Chamber of Commerce meetings to network and build relationships with new people. We also have salespeople going out to major corporations to build relationships with them and try to develop a partnership with them. We have a relationship with about 20 different companies where we send them a flyer and say that if they come into our store, we will give them VIP treatment. It encourages their associates to come to us when looking for a mattress. They will recognize our name and are more likely to visit our store. We also show at home shows. We donâ&#x20AC;&#x2122;t go there specifically for sales but more to meet people and build relationships. It helps people realize who we are. It is brand building and building our image. We also support many charities to get our name out there and make sure people know that we give back to the community. We are major sponsors of the Susan G. Koman Foundation. We just had our race in Phoenix last weekend and I got to start the race with the governor. We are also sponsors of 12 Who Cares, with a local TV station in town. We work with them to give contributions to one charity a month. We also have a program Bedmart Cares where we have people submit reasons they believe a person should have a free bed and then we donate a bed to someone in need. We have been doing many of these things for some time. The time you want to make sure that things work is when things are going well and not when things are going poorly. We try to get our name out there and help the community.

Our next Retailer Q&A question: How do you get rid of your dogs (unsold inventory)?

November/December 2008

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Contact WHFA at www.WHFA.org or (800) 422-3778.

Compact Fluorescent Halogen Replacements

est.1944

Lighting Products

Replace your ceiling floodlights with Energy Efficient CFL floodlights Eighty percent of your lighting costs is electricity. The cost of the bulb is very small compared to the electrical cost the bulb uses. By replacing just one 90-watt PAR38 floodlight with a 20-watt CFL PAR Replacement you can save $78.40 in energy costs over the life of the bulb.** Call WHFA or visit the website for more energy savings information on the complete line of CFL PAR38 Replacement Lamps.

Visit the WHFA website at www.WHFA.org and click on Store > Monthly Specials for more information

** Energy Savings based on a National Electrical cost average of $.14 kwh for 8,000 hours.

Call your WHFA representative or consult your Fall WHFA Product Catalog for complete description and pricing. (800) 422-3778. Western Home Furnishings Association 500 Giuseppe Ct., Suite 6 • Roseville, CA 95678 • (800) 422-3778 • www.WHFA.org • jspencer@whfa.org

Tour the WHFA website at www.WHFA.org > This month’s stop . . . Online Discussion Forums Western Home Furnishings Association

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simplify your business life And Join the Discussion WHFA’s online discussion forum gives you the opportunity to connect with other industry professionals 24/7. Discuss hot topics in areas of advertising and marketing, customer services, next generation/ succession planning, human resources, the industry, sales and sales management and warehouse and delivery. Whether you have a question to ask others, want to offer advice or just want to network with other retailers, the WHFA discussion forum is the place to visit!

ing only Interested in read You can c? pi about one to specific ve ha now select to ailed directly discussions em mply click on to your inbox. Si ce you are “Preferences” on sion forum inside the discus pics you are and select the to ning about. interested in lear

Western Home Furnishings Association • www.WHFA.org • (800) 422-3778 Contact WHFA at www.WHFA.org or (800) 422-3778.

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November/December 2008

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industry dates Market Dates November 23 – 25, 2008

January 16 – 19

Long Beach Furniture & Accessory Market Long Beach Convention Center Long Beach, CA www.kemexpo.com (800) 605-7440

January 24 – 27

California Gift Show® Los Angeles Convention Center (213) 362-5640 www.californiagiftshow.com

The Seattle Gift Show Washington State Convention & Trade Center (800) 272-7469 www.seattlegift.com

January 10 – 13, 2009

Portland Gift & Accessories Show® Oregon Convention Center, Portland, OR (800) 272-7469 www.portlandgift.com

High Point Market High Point, NC www.HighPointMarket.org (336) 869-1000 Future dates: October 17 – 22, 2009 April 17 – 22, 2010

Tupelo Furniture Market Tupelo, MS (662) 842-4442 www.tupelomarket.com

January Gift & Home Furnishings Market™ L.A. Mart, Los Angeles, CA (800) LAMART-4 www.lamart.com

Las Vegas Market — World Market Center Las Vegas, NV www.LasVegasMarket.com (866) 229-3574 Future dates: September 14 – 17, 2009 February 1 – 4, 2010

April 27 – May 3, 2009

January 24 – 28

January 13 – 19

February 9 – 13, 2009

WHFA Educational Events February 9 – 13, 2009

WHFA Educational Events Las Vegas Market — Free Business Seminars Retailer Resource Center WMC Building B, 16th Floor www.WHFA.org (800) 422-3778

RRC RETAILER

RESOURCE CENTER

National Home Furnishings Association Western Home Furnishings Association

March 29 - April 1, 2009

NHFA Retail Manager’s Workshop Renaissance Denver Hotel www.NHFA.org (800) 888-9590 x6151

April 27 – May 3, 2009

High Point Market — Free Business Seminars Retailer Resource Center IHFC Main Street, Floor 12 High Point, NC www.NHFA.org (800) 888-9590 RETAILER

RRC RESOURCE CENTER

National Home Furnishings Association Western Home Furnishings Association

May 17 – 19, 2009

2009 WHFA Conference & Expo Westin Maui www.WHFA.org W HFA (800) 422-3778 maui 2009

C ON F E R E N C E & E X P O

For more industry dates, visit www.WHFA.org and click on EVENTS & EDUCATION.

The 2009 Western Retailer of the Year Now more than ever it is time to honor dedication, reward commitment and celebrate excellence in the industry we feel so passionately about. Nominate Now Visit www.WHFA.org for all the details.